The BadThe new X-series PZ kit lens could use some design tweaks, and Panasonic's JPEG processing, though much better than before, could still use a little work.

The Bottom LineA well-designed camera with an interface that creative photographers can customize to their liking, the Panasonic Lumix DMC-GX1 deserves serious consideration if you're looking for a modestly compact interchangeable-lens model.

I happen to like the Panasonic Lumix DMC-GF3 for what it is: a model that delivers the photo quality and speed that point-and-shoot upgraders are looking for in a size substantially smaller than a dSLR and with an interface that's familiar to them.
But when it came out, I heard quite a few grumblings from people who wanted the real successor in the GF series. They didn't mind the slightly bigger size in exchange for a physical mode dial and hot shoe. Well, it looks like Panasonic heard those grumblings, too. Or perhaps it was always in the master plan. In any case, the Micro Four Thirds-based Lumix DMC-GX1 is the successor to the GF1 that the GF2 should have been. It resurrects that camera's better shooting design, most notably with the return of the physical mode dial, which Panasonic dropped from the GF2. It's actually a little bigger than that model, longer and deeper, but the depth comes from a slightly bigger grip and I can't fault it for that. Plus, it significantly improves on the performance and photo quality of both its predecessors.

But in other respects, it's just a modest update of the two GF models that precede it to bring it up to currency. It incorporates the sensor that's in the G3 (not the more advanced sensor from the GH2, despite the resolution similarity) and the current Light Speed autofocus architecture. Other additions to the camera are an electronic level and a one-button autoexposure override.

Though the GX1 delivers some of Panasonic's best photo quality to date, the issues with so-so JPEG processing remain, and its noise profile generally still can't match the NEX-5N. In good light, you can shoot JPEGs up to about ISO 400 without serious detail degradation, although even at ISO 200 you can see some softness, and at its lowest sensitivity of ISO 160, you can still see some noise in darker areas. But raw looks good up through ISO 800--a bit grainy and with some clipping in the shadows--and remains pretty usable at ISO 1,600. Colors render accurately and the exposures look on target.

The video looks good, and the 1080/30p MP4 option is a nice alternative to the interlaced AVCHD (although I don't know why it doesn't just incorporate AVCHD 2.0). It's sharp and pleasingly saturated, and the image stabilization in the X series lens does a fine job, but like most of the models in this class, it suffers from annoying rolling shutter. The stereo mic also fares pretty well, and though sensitive doesn't pick up any noise from the quiet power zoom lens.

While the GX1 lags the Nikon 1 J1 on single-shot or burst performance, it and its sibling the GF3 lead the class for shot-to-shot speed, which I tend to weight a little more heavily as long a camera performs pretty well on its single shots. It wakes and shoots in about a second: like the J1, the need to drive the lens while powering on slows the camera a little at startup. It can focus and shoot in good light in about 0.3 second and about 0.6 second in dim light. Shooting JPEG takes about 0.5 second for two sequential shots, which increases to about 0.6 second for raw; JPEG+raw feels adequately speedy. Using flash bumps the duration between shots by about a second. The GX1 bursts at about 4fps with LCD updates, a respectable time for its class, but as with many non-OVF cameras the display doesn't update fast enough to keep a moving subject in the frame. It also has an SH (super-high) speed burst mode, which shoots 20fps for 2 seconds.

I really like the design of the GX1, though I do have a few quibbles. It's a little bigger than the rest of the field, but none of these is sufficiently small with a lens attached to be considered significantly smaller than the others. It's got a nice-size grip and thumb rest, which makes it comfortable to hold and shoot single-handed, and it feels well constructed.

The camera includes a flash similar to the GF3's, which you can hold tilted back to bounce the light, a nice touch, and the hot shoe doubles as a mount for an optional electronic viewfinder. Aside from that, the controls have a fairly typical layout. The mode dial includes the usual set of PASM modes, plus two slots for four custom settings groups, scene modes, and Panasonic's rather uninspiring Creative Control special-effects modes. There's also an iA intelligent auto override button for quickly jumping in and out of auto mode, a Panasonic-specific implementation I like, and a video record button.

The back contains the usual array of controls as well, including two programmable function buttons, a button for toggling between manual and autofocus, and a jog dial for mode-specific adjustments. As with its sibling cameras, the GX1 has a great hybrid interface, which can operate either via the extremely customizable touch screen or completely via the hard controls; for instance, you can select which options appear on the Quick Menu, place the histogram anywhere on the screen, and perform almost any operation with either the buttons or touch. With the new PZ lenses, you can also zoom via the touch screen, at two different fixed and one variable speed, and it provides a readout of the focal length, a level of precision I like.